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FederalPassed42nd Parliament, 1st Session

Bill S-6 explained in plain English

An Act to implement the Convention between Canada and the Republic of Madagascar for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income

Federal Parliament bill summary, status, timeline, sponsor, votes, and official sources.

At a glance

Jurisdiction
Federal Parliament
Legislature / Parliament
Parliament of Canada
Session
42nd Parliament, 1st Session
Bill number
Bill S-6
Full title
An Act to implement the Convention between Canada and the Republic of Madagascar for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income
Current status
Passed
Latest event
Royal assent received
Last updated
May 27, 2019

Official Parliament of Canada snapshot for 42nd Parliament, 1st Session. MP vote breakdowns appear when the House of Commons publishes a recorded division export for that bill. Senate and House stage details include official debate/sitting links when LEGISinfo publishes them.

Chamber
Parliament of Canada
Current Stage
Royal assent received
Latest Activity
May 27, 2019
Plain-language explanation
In plain English (our explanation)

Our plain-language take, written for civic education.

Source: By PoliticalData.ca

AI-assisted, reviewed before publishing
Short Version

Bill S-6 implements a tax treaty between Canada and Madagascar to prevent the same income from being taxed twice and to prevent tax evasion.

What It Means

Bill S-6 implements a tax treaty between Canada and Madagascar. The treaty sets out rules to prevent the same income from being taxed twice—once in Canada and once in Madagascar—and to help prevent tax evasion. The treaty applies to people and companies living in or based in Canada or Madagascar. It covers Canadian income taxes and various Madagascar income taxes. The treaty's main rules determine where different types of income can be taxed. For example: - Income from land or property can be taxed where the property is located. - Business profits are generally taxed where the company is based, unless the company has a permanent office in the other country, in which case each country can tax the profits related to that office. - Dividends, interest, and royalties paid from one country to the other are subject to limits on withholding tax (a tax taken at the source). For instance, dividends paid to a Canadian company owning at least 25% of a Madagascar company are taxed at a maximum of 5%, while other dividends face a maximum of 15%. - Employment income is generally taxed where the work is performed, except in certain cases (for example, if someone works in the other country for fewer than 183 days in a year, the income may only be taxed where they live). - Pensions and annuities can be taxed in both countries, but with limits on how much tax can be charged. The treaty also sets out procedures for the two countries to exchange information, resolve disputes between taxpayers and governments, and make mutual agreements to prevent double taxation. The treaty became law in Canada when this bill received royal assent. It came into force after both countries notified each other that their internal procedures were complete. The Minister of Finance had to announce in the Canada Gazette when the treaty entered into force. The treaty can be terminated by either country with six months' notice, after five years from when it came into force.

What This Bill Does
  • Implements a tax treaty between Canada and the Republic of Madagascar designed to avoid double taxation and prevent fiscal evasion with respect to income taxes
  • Gives the treaty the force of law in Canada, making it legally binding
  • Sets rules determining which country can tax different types of income (such as business profits, dividends, interest, royalties, employment income, pensions, and capital gains) and establishes maximum withholding tax rates for certain income types
  • Provides procedures for the competent authorities of both countries to consult and reach agreements to resolve disputes and eliminate double taxation
  • Allows the competent authorities to exchange tax information needed to administer and enforce tax laws in both countries
  • Grants the Minister of National Revenue power to make regulations necessary to carry out the treaty
  • Requires the Minister of Finance to publish notices in the Canada Gazette indicating when the treaty enters into force and when it ceases to have effect
  • Establishes that the treaty prevails over other Canadian laws in the event of any inconsistency, except that the Income Tax Conventions Interpretation Act takes precedence over the treaty
  • Specifies that the treaty applies starting on January 1 of the calendar year following the year the treaty enters into force for withholding taxes, and for taxation years beginning on or after that date for other income taxes
Who Is Affected
  • Canadian residents and companies that earn income in Madagascar or receive income from Madagascar sources
  • Madagascar residents and companies that earn income in Canada or receive income from Canadian sources
  • Individuals working in Canada who are residents of Madagascar
  • Individuals working in Madagascar who are residents of Canada
  • Companies and partnerships with permanent establishments (fixed places of business) in the other country
  • People receiving dividends, interest, royalties, pensions, or annuities from the other country
  • The Minister of National Revenue, who gains authority to make regulations and exchange information
  • The Minister of Finance, who must publish notices about when the treaty enters into and ceases to have effect
Rights, Duties, Or Obligations
  • Canada and Madagascar must exchange information that is relevant for carrying out the treaty or administering their tax laws
  • Information exchanged must be kept confidential and used only for tax administration and enforcement purposes, or disclosed in public court proceedings or judicial decisions
  • The competent authorities must attempt to resolve disputes through consultation and mutual agreement
  • A person who believes they are being taxed in a way that does not comply with the treaty may submit a written application to the competent authority of their country of residence within three years of the first notification of the action
  • Neither country can increase the tax base of a resident of either country by including income that has already been taxed in the other country, except in cases of fraud, wilful default, or neglect, and only within five years of the end of the taxable period
  • The Minister of National Revenue may make regulations necessary to carry out the treaty
  • The Minister of Finance must publish a notice in the Canada Gazette when the treaty enters into force (within 60 days) and when it ceases to have effect (within 60 days of that event)
Important Dates
  • The treaty entered into force on the later date of the two countries' notifications that their internal procedures were complete
  • For withholding taxes: the treaty's rules applied starting January 1 of the calendar year following the year the treaty entered into force
  • For other income taxes: the treaty's rules applied for taxation years beginning on or after January 1 of the calendar year following the year the treaty entered into force
  • Either country can terminate the treaty by giving notice of termination at least six months before the end of any calendar year, but only after the treaty has been in force for at least five years
Financial Or Tax Impacts
  • Establishes maximum withholding tax rates: 5% for dividends paid to companies owning at least 25% of the paying company, 15% for other dividends
  • Sets a maximum 10% withholding tax on interest income
  • Sets a maximum 10% withholding tax on royalties, with a reduced 5% rate for copyright royalties and certain computer software royalties
  • Sets a maximum 15% withholding tax on periodic pension payments and annuities (with some exceptions)
  • Provides relief from double taxation by allowing credits for taxes paid to the other country
  • Allows residents to be taxed on employment income only in their country of residence if they work in the other country for fewer than 183 days in a 12-month period and other conditions are met
  • Restricts which country can tax capital gains: gains from the sale of land are taxable where the land is located, gains from the sale of shares or partnership interests are taxable where the underlying property is located, and other gains are taxed only in the country where the seller lives
Enforcement Or Penalties
  • The treaty text does not contain specific penalties; enforcement relies on each country's domestic tax laws
  • The Income Tax Act continues to apply to determine penalties for non-compliance
  • Neither country can change a person's tax assessment after the time limits in its domestic laws, or more than eight years from the end of the year the income would have been attributed (under Article 9 regarding associated enterprises), except in cases of fraud, wilful default, or neglect
  • Neither country can increase a resident's tax base by including income already taxed in the other country more than five years after the end of the taxable period, except in cases of fraud, wilful default, or neglect (under Article 24)
Uncertainties Or Limits
  • The bill text does not specify the exact date the treaty entered into force; it only states that the treaty enters into force on the later date of the two countries' notifications of completion of their internal procedures
  • The bill does not provide detailed mechanisms for how the information exchange between the two countries will be conducted, only that the competent authorities must exchange relevant information
  • The bill does not specify which Madagascar taxes apply; it only lists the major categories of Madagascar taxes covered, and notes that the convention also applies to any identical or substantially similar taxes imposed after the treaty was signed
  • The arbitration procedure referenced in the treaty (Article 24, paragraph 6) is to be established in an exchange of notes between the two countries, which is not included in the bill text
  • The treaty contains various defined terms and concepts (such as 'permanent establishment,' 'beneficial owner,' and 'fixed base') that require interpretation according to the context and applicable law
  • Some relief provisions have exceptions or special rules that may not apply in all circumstances; for example, students receiving maintenance payments are exempt from taxation only if the payments come from sources outside the country where they are studying
  • The practical application of the treaty's rules depends partly on how each country's domestic tax laws interact with the treaty, which is outside the scope of this bill
Laws Or Regulations Affected
Income Tax Act
Modified

The treaty provides relief from some taxation rules in the Income Tax Act by setting limits on which country can tax certain types of income and establishing maximum withholding tax rates

Source: Bill S-6, Section 2; Treaty Articles 10, 11, 12, 18

Income Tax Conventions Interpretation Act
Remains Superior

In any conflict between the treaty and the Income Tax Conventions Interpretation Act, the Income Tax Conventions Interpretation Act takes priority

Source: Bill S-6, Section 4(2)

Generated using AI from official bill text. Not legal advice. It is written by PoliticalData.ca for civic education, automatically checked and spot-reviewed before publishing.

Official text

Parliamentary Process

Step 1
First reading
Oct 16, 2018
Completed

Bill S-6, concerning a double taxation agreement with Madagascar, completed its first reading in the Senate on October 16, 2018, and ultimately received Royal Assent on May 27, 2019.

Introduction and first reading, Oct 16, 2018
End of stage activity, Oct 16, 2018
Chamber sittings
Introduction and first reading - Oct 16, 2018

On October 16, 2018, Bill S-6, an act to implement a tax convention with Madagascar, received its first reading in the Senate as part of a broader day of Senate proceedings.

Step 2
Second reading
Nov 20, 2018
Completed

This record outlines the procedural steps of Bill S-6, specifically the Senate's second reading process related to a double taxation agreement with Madagascar, leading to its eventual Royal Assent.

Second reading, Nov 20, 2018
Referral to committee, Nov 20, 2018
End of stage activity, Nov 20, 2018
Chamber sittings
Debate at second reading - Oct 24, 2018

On October 24, 2018, the Senate sat, hearing statements, considering notices of motions, debating the carbon tax and other issues during Question Period, and continuing debate on or referring several bills, including Bill S-6 concerning a tax convention with Madagascar.

During the Senate's second reading debate on Bill S-6, the sponsor explained the bill's purpose is to implement a double taxation avoidance treaty between Canada and Madagascar and facilitate information sharing to combat fiscal evasion.

Debate at second reading - Nov 20, 2018

The Senate convened for a sitting that included the second reading debate and referral of Bill S-6 (Canada-Madagascar Tax Convention) to committee, alongside other legislative and procedural business, and senator statements.

The Senate debated Bill S-6 at second reading to implement a tax convention with Madagascar, with one senator expressing support for the bill but raising concerns about the government's broader efforts against international tax evasion, after which the bill was referred to committee.

Step 3
Consideration in committee
Dec 6, 2018
Completed

Bill S-6, an act to implement a double taxation agreement with Madagascar, completed its committee review stage in the Senate on December 6, 2018.

Committee report presented without amendment, Dec 6, 2018
End of stage activity, Dec 6, 2018
Chamber sittings
Committee report presented without amendment - Dec 6, 2018

The Senate's Foreign Affairs and International Trade Committee presented its report on Bill S-6, recommending the bill without amendment, after which it was scheduled for third reading.

Step 4
Third reading
Dec 11, 2018
Completed

The Senate completed the Third Reading stage for Bill S-6 on December 11, 2018, a step that preceded its eventual Royal Assent on May 27, 2019.

Third reading, Dec 11, 2018
End of stage activity, Dec 11, 2018
Chamber sittings
Debate at third reading - Dec 7, 2018

On December 7, 2018, the Senate engaged in routine proceedings, question period, and debates on multiple bills, including Bill S-6 which had its third reading debate adjourned, and adopted reports on committee findings and financial estimates, before adjourning.

Debate at third reading - Dec 10, 2018

On December 10, 2018, the Senate debated and passed Bill S-6 at its third reading, concerning a tax convention with Madagascar, alongside discussions and votes on other significant legislative matters.

Step 1
First reading
Jan 28, 2019
Completed

Bill S-6, concerning an income tax treaty with Madagascar, completed its First Reading in the House of Commons on January 28, 2019.

First reading, Jan 28, 2019
End of stage activity, Jan 28, 2019
Chamber sittings
First reading - Jan 28, 2019

The House of Commons held its first reading debate for Bill S-6 on January 28, 2019, completing the stage.

Step 2
Second reading
Feb 27, 2019
Completed

On February 27, 2019, the House of Commons completed the second reading of Bill S-6, agreeing to the bill and referring it to a committee.

Second reading and referral to committee, Feb 27, 2019
End of stage activity, Feb 27, 2019
Chamber sittings
Debate at second reading - Feb 21, 2019

Members of Parliament debated Bill S-6 at its second reading, discussing the convention between Canada and Madagascar aimed at avoiding double taxation and preventing fiscal evasion, with various perspectives on tax treaties, government policy, and procedural matters.

During the second reading debate in the House of Commons, the sponsor and other members discussed Bill S-6, an act to implement a tax convention with Madagascar, focusing on its role in promoting trade, investment, and combating tax evasion.

Members of the House of Commons debated Bill S-6, a tax treaty with Madagascar, discussing its importance for trade and tax fairness, while also raising broader economic and political concerns.

During the House of Commons second reading debate on Bill S-6, MPs discussed the bill's aim to implement a tax treaty with Madagascar to prevent double taxation and tax evasion, while also raising broader concerns about tax fairness and the government's fiscal policies.

Debate at second reading - Feb 27, 2019

This House of Commons sitting on February 27, 2019, featured debate on Bill S-6 concerning a tax convention with Madagascar, alongside extensive discussions on the SNC-Lavalin affair and other government business, ultimately leading to the bill's second reading and referral to committee.

Step 3
Consideration in committee
May 2, 2019
Completed

The House of Commons completed its committee stage consideration of Bill S-6 on May 2, 2019, before the bill received Royal Assent.

Committee report presented without an amendment, May 2, 2019
End of stage activity, May 2, 2019
Chamber sittings
Committee report presented without an amendment - May 2, 2019

The House of Commons considered the Multilateral Instrument in Respect of Tax Conventions Act, presenting a committee report without amendment and subsequently passing the bill.

Step 4
Report stage
May 14, 2019
Completed

Bill S-6 completed its report and third reading stages in the House of Commons on May 14, 2019, and subsequently received royal assent on May 27, 2019.

Concurrence at report stage, May 14, 2019
End of stage activity, May 14, 2019
Chamber sittings
Debate at report stage - May 14, 2019

The House of Commons completed the report stage and third reading of Bill S-6, an act to implement a tax convention between Canada and Madagascar, and also engaged in debates on various other government and private members' business.

Step 5
Third reading
May 14, 2019
Completed

The House of Commons completed the Third Reading of Bill S-6, an act to implement a double taxation agreement with Madagascar, on May 14, 2019, after which it received Royal Assent.

Third reading, May 14, 2019
End of stage activity, May 14, 2019
Chamber sittings
Debate at third reading - May 14, 2019

During the House of Commons debate on May 14, 2019, Bill S-6, concerning a tax convention with Madagascar, successfully passed its third reading.

Step 1
Royal assent
May 27, 2019
Royal assent, May 27, 2019
End of stage activity, May 27, 2019
Chamber sittings
Royal assent - May 27, 2019

We don't have a plain-language summary for Debates of the Senate yet. The official source linked below is the full record.

Debate and sitting links point to official parliamentary sources when LEGISinfo publishes them. Any plain-language discussion summaries should be generated from those official texts and reviewed before public display.

Vote Summary

No published recorded division

This bill does not have a published recorded division in the current official sources, so representative-by-representative vote counts are not shown.

Sponsor
Peter Harder
Senator | Progressive Senate Group (PSG) | Ontario
Jurisdiction
Federal Parliament

No published representative vote breakdown

The current official sources do not publish a recorded division breakdown for this bill, so there is no representative-by-representative table to show.

Official sources

Status, sponsor, votes, and timeline on this page are drawn from these official legislative sources and public records. Each summary above is attributed to its own source.

How this data is sourced